Hassan Azam Shibbli
THE present economic crisis of Pakistan is an amalgamation of poor decision making, decades of incompetence on the part of successive governments in general and the last two governments of PPP and PML-N in particular. As a result all the financial indicators of Pakistan have seen a downward trend that saw a major surge after the current government remained in uncertainty for at least 8 initial months of coming in the power. The only remedy available to US is to improve exports but it’s a long journey and during this period we as a nation are required to remain patient and learn to live within our limited resources. Unfortunately we lack innovative products and are mostly relying on conventional export items like cotton textiles that is more or less restricted to yarn, bed linen and towels. We are lagging behind in garments and high-end textiles that can fetch us more foreign exchange as being witnessed in the case of Vietnam and Bangladesh who enjoy export worth US dollar 38 billion and 242 billion respectively against ours 22 billion.
No country in the last few decades has developed without foreign investment where China, Vietnam, Malaysia and most recently Bangladesh are the clear examples. Pakistan did have a chance in the early 80s to attract foreign investment in its exports-oriented industry but unfortunately we engaged ourselves in Afghan war that had completely destroyed our social fabric and brought in religious extremism, intolerance, communal riots, tension on our geographical borders, international isolation and a state of insurgency in certain areas of the country. In the meantime we gave a wonderful opportunity to India to develop its IT and export oriented industry and from that period onwards India has never looked back so much so that its IT exports alone are now around 100 billion dollars against less than 2 billion dollars of Pakistan.
We are in wilderness since the 80s, no direct foreign investment in export-oriented industry except for telecom and banking (all falling in services sector where billions of dollars have been repatriated abroad in the name of dividends), the short-sighted and greedy rulers were hungry for mega projects to earn kickbacks and left the country with current account deficit (CAD) of 20 billion dollars, 22 billion dollars exports and 60 billion dollars imports. The CAD number would have been even more if it was not cushioned by the foreign remittances of overseas Pakistanis. It is unfortunate that during PML-N era the country witnessed massive investment of US Dollars 20 Billion in CPEC funded projects like motorways, highways, imported coal and RLNG-based power plants that has taken a beating on the already degrading environment and famous metro train project of Lahore where US dollars 3 billion were invested on a 27 KM track that has yet to commence its commercial operations. Unfortunately not a single cent was invested in export oriented industry.
PTI Government came into power with high promises and tall claims but soon succumbed to mounting monetary and fiscal deficits and was forced to enter into IMF Program that has invited heavy devaluation, increase in interest rates, imports restraints and tightening of monetary and fiscal policies. Resultantly CAD dropped significantly but in the absence of any real growth in exports our economic woes still continue unabated and the country has yet to come out of its ongoing economic crisis. On top of that the highhandedness shown by Imran Khan-led PTI government against sugar sector the 2nd biggest agro-based industry that has a potential to fetch 3 billion dollars as exports and oil marketing companies where about 70% share is enjoyed by the government through PSO and Total PARCO has had an adverse impact on ease of doing business in the country. The ongoing investigation is not going to yield any positive result rather it will only result in a loss of time and public money. As mentioned earlier we have no option except to encourage and promote our export-oriented industry which is led by cotton textiles, rice, sugar and allied products. We are predominantly an agrarian economy, therefore, we must invest heavily in our agriculture sector by building small dams and improving agriculture know-how of our farmers by introducing modern agriculture techniques. It’s high time to formulate a long term investment policy to curb insurgency and extremism. Give real incentives to corporate sector and encourage them to get themselves listed on Pakistan Stock Exchange (PSX) which nowadays is working like a gambling house; this initiative will also discourage fraudulent housing societies and a highly unproductive file culture. It will also channelise the public investment in industrial units. More industry more exports more employment more taxes and more income for government to develop infrastructure from own money instead of heavy borrowings.
The government should make sincere efforts to bring in Foreign Direct Investment in export-oriented industry that will only come if we defuse tension on our borders. Remember Holy Prophet (PBUH) entered into Hudabiya Treaty despite heavy resistance from his companions but he always knew that Muslims cannot afford repeated wars with kuffars. And in only 2 years’ time he gathered enough of resources and power to conquer Mecca. In the battle ofBadar he had only 313 Muslims around him but at the time of Mecca conquest he was having 10,000 soldiers that was made possible only due to Hudabiya Treaty which gave 2 year peace time to Holy Prophet (PBU) and the objective was achieved. It’s high time for us to learn from the teachings and deeds of our beloved Prophet (P.B.U.H) in true sense. Remember Jews remained in wilderness for 40 years but we as a nation are in wilderness since last 74 years and this process will keep on going unabated unless we mend ourselves by adopting correct policies and taking the masses onboard instead of making false promises and keeping them in fool’s paradise.
—The author is a former banker and a freelance writer.
